Start with the gross edge per pair: payout minus the combined contract prices. That is the clean mathematical spread if both legs fill exactly where you think and there are no other costs.

• Gross edge identifies the theoretical mispricing.
• Variable costs scale with size and price.
• Flat costs matter more when the trade is small.
• Net edge is the decision metric, not gross edge.

Use executable prices, not wishful prices. If the best displayed quote is only available for a tiny amount, model the price you expect to pay at the size you are actually planning to trade.

1. Enter both leg prices and the standard payout per matched pair.
2. Add fee and slippage assumptions for each leg separately.
3. Include flat movement or withdrawal costs.
4. Check whether the net edge still clears your minimum threshold.

Suppose one leg costs $0.41, the complementary leg costs $0.54, and the standard payout is $1.00. Gross edge is 5 cents per pair. That sounds attractive until you layer in taker fees, slippage on both books, and the fixed cost of moving or withdrawing capital.

• A gross edge can be positive while the net edge is weak or negative.
• Bankroll only helps if enough executable size exists at the entered prices.
• The output is only as good as the execution assumptions you feed it.

The biggest mistake is trusting top-of-book quotes without checking depth. The second is ignoring flat costs because they look small relative to one pair, even though they can wipe out a modest setup once the math is done honestly.

• Ignoring book depth and realistic fill quality
• Using aggressive slippage assumptions that only work at tiny size
• Treating gross edge as if it were deployable profit
• Skipping rule parity checks across venues

Professional thresholding: If a setup only works under optimistic slippage, it should usually be rejected. Net edge should survive conservative execution assumptions, not depend on perfect fills.